Mrs. Justice S. Sujatha

Rule 8(5) of the Securitisation Interest (Enforcement) Rules, 2002 does not contemplate to get a fresh valuation report for each and every sale notice – M/s. Soumya Engineering Vs. The Chief Manager Indian Bank – Karnataka High Court

In this decision, following points were considered: Requirement of fresh valuation report for each and every sale notice, Sale consideration deposit, Extend sale deposit period and Power of judicial review.

Rule 8(5) of the Securitisation Interest (Enforcement) Rules, 2002 does not contemplate to get a fresh valuation report for each and every sale notice – M/s. Soumya Engineering Vs. The Chief Manager Indian Bank – Karnataka High Court Read Post »

A secured creditor will be having first charge of a property if the order of attachment is subsequent to the date of mortgage – Bank of India Vs. The State of Andhra Pradesh – Andhra Pradesh High Court

In this case, after issuance of sale certificate in auction u/s 13 of the SARFAESI Act, S.R.O. refused to register the same on the ground that the subject properties are placed in prohibited list due to attachment orders received.
Hon’ble High Court held that on a conjoint reading of Section 26E of the SARFAESI Act, 2002 and Section 31B of RDB Act, 1993, there cannot be any doubt that the rights of a secured creditor to realize the debts due and payable by sale of assets over which security interest is created, would have priority over all the debts. The petitioner will be having first charge of the property if the order of attachment is subsequent to the date of mortgage. In the instant case, admittedly, the mortgage of the documents was in the year 2015 and 2017 and the attachment orders came to be passed in the year 2018 i.e., long after the property was mortgaged to the secured creditor. Hence, the rights of the petitioner bank/secured creditor to realize secured debts due and payable to it by sale of assets over which security interest is created shall have priority and, hence, the point is answered in favour of the petitioner bank.

A secured creditor will be having first charge of a property if the order of attachment is subsequent to the date of mortgage – Bank of India Vs. The State of Andhra Pradesh – Andhra Pradesh High Court Read Post »

Whether Recovery Officer has power to extend time for payment of auction amount? – M/s. Kirlampudi Sugar Mills Ltd. Vs. Recovery Officer-II, DRT – Andhra Pradesh High Court

The Court observes that whether the Recovery Officer was right in issuing notices to the auction purchaser for payment of balance 75%, after expiry of 15 days time from the date of auction? Instant case is not one where there was any condition in the Sale Notice giving power to the Recovery Officer for extension of time. But, here is a case where the amount could not be paid by the auction purchaser due to an interim order passed by the High Court at the instance of the borrower and the subsequent order passed by the High Court at the instance of the borrower, who ultimately failed to succeed in the Writ Petitions filed by him. Some leverage of time should be given to the Recovery Officer to verify the fact situation and then proceed further, as directed by the High Court, more so, when no time-limit was fixed by the Court in its interim order. Further, the issuance of notice to auction purchaser by the Recovery officer cannot be found fault, for the reason, that the Hon’ble Court in its interim order, gave such power to him, namely, issuance of sale certificate, which can be only after payment of balance 75% of sale consideration, for which a notice is required to be given.

Whether Recovery Officer has power to extend time for payment of auction amount? – M/s. Kirlampudi Sugar Mills Ltd. Vs. Recovery Officer-II, DRT – Andhra Pradesh High Court Read Post »

Whether an application filed under Section 8 of the Arbitration and Conciliation Act, 1996 deserves to be adjudicated upon by the Adjudicating Authority (NCLT) prior to adjudication of the proceedings under Section 7 of the IBC? – Urban Infrastructure Trustee Ltd. Vs. Ozone Propex Pvt. Ltd. – Karnataka High Court

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Whether an application filed under Section 8 of the Arbitration and Conciliation Act, 1996 deserves to be adjudicated upon by the Adjudicating Authority (NCLT) prior to adjudication of the proceedings under Section 7 of the IBC? – Urban Infrastructure Trustee Ltd. Vs. Ozone Propex Pvt. Ltd. – Karnataka High Court Read Post »

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